"We hope this consumer and business action will result in better online options for more South Africans," says Webber. "That said, we remain convinced that most of the issues raised by the hearing and other user woes would be solved with the introduction of an open market environment," says Webber.
According to reports, one of the more contentious issues surrounding the hearings has been Telkom's now infamous 3GB "bandwidth cap". With the standard Telkom service, an ADSL user is only entitled to utilise 3GB of data per month. Those who overshoot the bandwidth cap are relegated to a much slower connection, which many say is nowhere near even dial-up connectivity speeds.
In response to questioning around the bandwidth cap, Telkom's Raveshina Robert is reported to have felt concerned that the company was "being singled out" as other broadband operators such as Sentech and Vodacom had implemented similar systems, yet not faced anywhere near the same level of complaint. "This logic may suffice in an open market where broadband providers have an option to choose which company ultimately provides their connectivity," says CUASA Executive Committee member, Marc Furman. "However, in South Africa, there is no real option. Telkom holds a de facto monopoly over the supply of Internet bandwidth and other providers have no option but to cap bandwidth usage owing to the high cost of South African bandwidth," Furman continues.
"Another problem with Telkom's ADSL is that the incumbent charges way too much for the access line component of the service," says Furman. It would appear that the ADSL offering is back to front - with Telkom taking the lion's share of ADSL revenue for simple connectivity to the relevant local exchange. ISPs charge a separate, lower fee for ultimately more valuable Internet connectivity. "Furthermore, the ISPs have been given an option to provide ADSL services in such a way that they essentially become resellers of Telkom’s ADSL user accounts. This removes from the ISP any real control of the service it offers," he says.
"To the consumer, it may seem that ISPs and broadband providers such as iBurst and Sentech provide their own connectivity. In reality, their reach only goes so far. Ultimately it's Telkom which controls South Africa's net traffic. No matter how much broadband providers may want to supply their own bandwidth at competitive pricing, South Africa's closed market prevents this as an option," says Furman.
"South African access to international bandwidth via the SAT 3 cable is considerably more expensive than similar bandwidth costs overseas," Furman continues. "Again, it's Telkom which essentially controls access to SAT 3 - the real reason why international bandwidth is so expensive in South Africa. South Africans in general and ISPs in particular need competitive alternatives to the high cost of international bandwidth. As the very least, ICASA should investigate the possibility of declaring SAT 3 an essential facility, thereby regulating the cost of international bandwidth. ICASA currently regulates certain of Telkom's tariffs because the incumbent is still essentially a monopoly. They don't, however, regulate the cost of international bandwidth over which Telkom also commands a monopoly," he says.
"High bandwidth costs and related connectivity problems do not occur in countries which enjoy open markets and effective competition," says Webber. "Like telecommunications, competition in the broadband arena is effectively limited by South Africa's archaic and restrictive legislation and regulation which is designed to protect Telkom. International experts and numerous examples indicate that only effective competition ultimately solves bandwidth woes," he concludes.
Source: http://www.cuasa.org.za
